West African leaders reaffirm 2020 deadline for single currency

ACCRA, Feb. 24– Leaders of the West African sub-region gave a
firm assurance here on Wednesday of meeting the 2020 deadline for the
introduction of the Eco single currency.

A declaration issued at the end of the Fifth Meeting of the Presidential
Task Force on ECOWAS (Economic Community of West African States) single
Currency Program added that the sub-region would, however, gradual approach
to the convergence and introduction of the single currency. The
Presidential Task Force includes President Addo Dankwa Akufo-Addo of Ghana,
Faure Essozima Gnassingbe of Togo, Alassane Ouattara of La Cote d’Ivoire,
Issoufou Mahamadou of Niger, Muhamadu Buhari of Nigeria, who was
represented at the Wednesday meeting by Godwin Emfiele, Governor of the
Nigerian central bank, and Alpha Conare, President of Guinea, who was also
represented by Lounceny Nabe, Governor of the Guinean central bank.

When the sub-regional leaders met in Accra in 2000 to introduce a second
monetary zone and introduce a second currency called the Eco, they added a
number of primary convergence criteria for each member of the second
monetary zone to make Eco a reality. “The Task Force reaffirmed the
gradual approach where member states which meet the Convergence Criteria
can start the Monetary Union while the other countries join later,” the
declaration announced. Meting the primary convergence criteria has since
2002 been the bottleneck in the introduction of the second monetary union
in the sub-region, compelling the leaders to return to the initial plan of
a single currency for the entire sub-region which will merge the
Francophone and Anglophone zones as well as the Portuguese and Spanish
speaking zones.

The West African Monetary Zone (WAMZ) set up a Primary Criteria for the
six-members ECOWAS — Gambia, Ghana, Nigeria, Sierra Leone and one
francophone member Guinea, and later Cape Verde. The WAMZ aims to achieve
and maintain price stability by recording single digit end of period
inflation rate by 2003 and five percent by 2004. It is also to ensure
sustainable government fiscal position by reducing the ratio of budget
deficit (excluding grants) on commitment basis to GDP to four percent. The
countries are to limit Central Bank financing of government budget deficit
as a percent of previous year’s tax revenue to 10 percent or less, as well
as maintain sufficient level of gross official foreign exchange reserves of
at least three months of import cover.

In adopting the progress made by member countries, the Task Force adopted
the revised roadmap for accelerating the creation of the ECOWAS Single
currency by 2020, instructing all member-countries to implement vigorously
the revised roadmap. The Task Force also reaffirmed the commitment to fund
the ECOWAS single currency program by the member-states and central banks.
“Our quest for a single currency is not intended to boost trading of goods
produced in third-party countries. It is meant to encourage the production
of goods and services within the region. “The structural transformation of
our economies can no longer be postponed if we are to meet the aspirations
of our young people for jobs,” President Akufo-Addo declared at the opening
of the meeting. He argued that the era of Africa’s industrialization had
dawned so that “we can also trade in the world economy, not on the basis of
the export of raw materials but on the basis of things we make.” “It is
thus incumbent on us to strengthen the production base of our economies and
to improve agricultural productivity and industrial production. There is a
viable market ready to absorb the goods which will be produced by our
countries,” Akufo-Addo stressed. – XINHUA